Canada - Windsor-Essex Regional Chamber of Commerce

Canadian Automotive
Summary & Outlook
Policy and Solutions
Forum
Steve Rodgers, President
GS Global Solutions
Global LV Production
(2009 – 2022)
2022 = 106.5 Million
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
70,000,000
60,000,000
50,000,000
40,000,000
30,000,000
20,000,000
10,000,000
0
2015 (Mil)
Region
2022 (Mil)
Middle-East/Africa
Asia-Pacific
Eastern Europe
Western Europe
South America
North America
2022 VS. 2015 Growth
2022 vs. 2009 CAGR
2022 vs. 2015 CAGR
NA
17.5
19.2
10.0%
6.4%
1.4%
SA
3.1
4.1
32.4%
0.8%
4.1%
WE
14.2
14.8
3.9%
1.7%
0.5%
EE
6.82
8.2
21.7%
4.0%
2.8%
AP
45.5
57.4
26.1%
5.4%
3.4%
ME/A
2.2
2.8
25.0%
3.6%
3.2%
TOTAL
89.3
106.5
19.3%
4.5%
2.6%
Source: WardsAuto/AutoForecast Solutions – January 2016
2
Global LV Production
(2009 – 2021)
20,000,000
Asia-Pacific
Removed
18,000,000
16,000,000
14,000,000
12,000,000
Middle-East/Africa
Eastern Europe
Western Europe
South America
North America
10,000,000
8,000,000
6,000,000
4,000,000
2,000,000
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
0
Source: WardsAuto/AutoForecast Solutions – May 2015
3
Top 20 Country Analysis (2014 vs.
2021)
Source: WardsAuto/AutoForecast Solutions – September 2015
4
NAFTA LV Production
(2009 – 2021)
2021 VS. 2014
Growth
2021 vs. 2009
CAGR
2021 vs. 2014
CAGR
1.94
-18.7%
2.3%
-2.9%
3.23
4.67
45.3%
9.8%
5.5%
United States
11.51
12.29
7.8%
6.7%
1.1%
TOTAL NA
17.00
18.90
11.2%
6.8%
1.5%
Region
2015 (Mil)
2021 (Mil)
Canada
2.26
Mexico
Source: WardsAuto/AutoForecast Solutions – September 2015
5
NAFTA LV Production
(2009 – 2021)
Canada NAFTA Market Share Declining
Source: WardsAuto/AutoForecast Solutions – September 2015
6
Canadian LV Production
(2009 – 2022)
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2,500,000
2,000,000
1,500,000
1,000,000
500,000
0
Multimatic
Toyota
Honda
GM
Ford
Fiat-Chrysler
VM
2015
2022
Volume Diff (2022 vs. 2015)
Fiat-Chrysler
514K
468K
-46K
Ford (incl. Multimatic)
196K
249K
53K
GM
579K
181K
-398K
Honda
382K
364K
-18K
Toyota
593K
568K
-25K
TOTAL
2,264K
1,830K
-434K
Source: WardsAuto/AutoForecast Solutions – December 2015
7
NAFTA Greenfield Production
2,000,000
•
BMW San Luis Potosi (2019)
•
COMPAS (RNNS + Daimler) Aguascalientes (2017)
–
–
–
1,800,000
1,600,000
Daimler North Charleston (2018)
•
Faraday Futures North Vegas (2017)
–
Freightliner Sprinter
Faraday (Large EV Plus, MP-EV, Sedan)
•
FCA Saltillo Van (2013)
•
Ford (via Multimatic) (2016)
–
1,200,000
Infiniti QX30
Daimler (A-Class SWB, GLB)
•
–
1,400,000
BMW (2-Series, 3-Series, 4-Series)
–
Ram ProMaster
Ford GT
1,000,000
•
Ford Queretaro (2018)
800,000
•
Honda Performance Manufacturing Center (2016)
600,000
•
Honda Celaya (2014)
•
Hyundai Monterrey (2016)
–
–
–
400,000
–
200,000
Mazda Salamanca (2014)
•
Elux Karma EV/EVER
Mazda (2, 3)
Toyota Yaris / Scion iA
RNNS Aguascalientes 2 (2013)
–
Nissan (B-CUV, Sentra)
•
Toyota Guanajuato (2018)
•
Volvo (Geely) Berkeley County (2018)
–
Source: WardsAuto/AutoForecast Solutions – Jan 2016
Kia (Forte, Rio)
•
–
–
Mexico
Honda (Fit/Jazz, HR-V/Vezel)
Karma Automotive (2016)
–
United States
Acura NSX
•
0
Canada
Ford Focus
–
•
Toyota Corolla
Volvo (S60/S60L, XC60)
VW San Jose Chiapa (2015)
–
Audi Q5
8
Canada: Production Stability
Honda/Toyota
–
–
–
–
–
Production supports NAFTA consumption
Only location for RAV4 production in NAFTA
CR-V for Europe and addition of RX450h for NAFTA consumption
Strong domestic supply chain
Corolla move to Mexico leaves some uncertainty to maximizing capacity at
Cambridge
Ford
–
–
–
Oakville ONLY source of Edge, Flex, MKT, MKX
New investment in global Edge program
Ford GT via Multimatic relationship in Markham, Ontario
FCA
–
–
Windsor only source for Minivans
Bramalea only source for Challenger, Charger, 300 (NAFTA) / plant refresh
needed
–
–
–
–
–
–
–
All Canadian-built vehicles can be built elsewhere!
Equinox – 4 Locations in NAFTA / 2 in Future
Terrain - 2 locations in NAFTA; exiting Canada in 2017
Camaro – LEAVING Canada Prod in late 2015
Regal – LEAVING Canada Prod 2017
Impala – LEAVING Canada Prod late 2019
XTS – “Replaced” by CT6 in 2016/2017 (Hamtramck/China)
GM
9
Domestic Investment: Ford
• 2013 - Investment to support global LV platform
– $700 Million from Ford; supported by:
• $71.6 Million from Federal government
• $70.9 Million from Provincial government
– Utilizing $250 Million Automotive Innovation Fund
– 2,800 jobs protected as result
– Adds approx. 1000 additional jobs
• Oakville annual production range = 210K to 275K thru
2021
10
FCA - Bramalea
• LX (RWD/AWD)
– Chrysler 300, Dodge Charger, and Dodge Challenger
– Italy (50K):
• Maserati Ghibli and Quattroporte sedans
• Maserati Levante Mid-sized CUV
– Bramalea is the only NA facility producing the LX platform
– Shares some powertrain components with the Jeep Grand
Cherokee and Ram pickups
• Annual production volumes range = 220K – 245K
• Chrysler 300 peak volumes in 2005 at 190K
– 2015 = 74K units
– Refreshed versions could get upwards of 80k max but not near
2005 levels.
11
FCA - Windsor
RU (FWD/AWD)
• Replaces the RT platform with Chrysler Town &
Country ONLY
• NO Dodge version
• $2 Billion+ investment in facility
– 14 week shutdown (until May 25th)
• Sole source of FCA minivans and the RU platform
globally
• 2014 production volumes topping off at 370K
• Reducing to <300K annual range once Dodge Grand
Caravan is eliminated
– 100% capture rate of Dodge customers highly unlikely
12
FCA 5-Year Plan Analysis
Active Plant Production Max from
2004:
Thru 2013
2.831 Million
Thru 2014
3.035 Million
Thru 2018
3.072 Million
Good News: Canadian production
footprint required to hit FCA 5-Year
Goals
Reality: Financial performance will
outweigh production targets
FCA 5-Year Plan (May 2014)
Target 2018
2.970 Million
Max Bramalea
0.319 Million
Max Windsor
0.373 Million
13
Domestic Investment: GM
• 2015 – Ingersoll (Cami)
– $450 Million to assemble next generation Chevy Equinox
• Approx. $150 Mil on equipment and tools
• Approx. $300 Mil investment for vendor tooling with
Canadian suppliers
• Without financial aid from federal or provincial sources
• Future of GMC Terrain not discussed in investment
– Still expected to move to Mexico in 2016
– Producing over 315K units in 2014 using 3 shifts + overtime
– Up to 3,000 jobs protected as result
• Ingersoll annual production range = 316K to 198K thru 2021
14
Spotlight GM - Buick Regal
Regal Production
300,000
250,000
200,000
150,000
100,000
50,000
0
• Global Epsilon
• Primary consumption as
Buick in Chinese market
• Opel Insignia sibling in
Germany
• 2015 NAFTA Sales
– Canada - 816
– US – 19,504 (22,560)
– Mexico - 120
Germany (Russelsheim)
China (JinQiao)
Canada (Oshawa 1)
15
Spotlight GM - Cadillac XTS
XTS/CT6 Production
100,000
• Global Epsilon  Omega
• Replaced indirectly by CT6:
– Hamtramck (2015) & China
(2016)
80,000
60,000
40,000
20,000
0
• 2015 NAFTA Sales
– Canada - 743
– US – 23,112 (24,335)
– Mexico - 0
CT6 (China)
CT6 (Hamtramck)
XTS (China)
XTS (Oshawa 1)
16
Spotlight GM - Chevrolet Camaro
Camaro Production
• Zeta  Global Alpha
100,000
80,000
60,000
40,000
• 2015 NAFTA Sales
– Canada – 2,880
– US – 81,588 (88,941)
– Mexico – 1,362
20,000
0
US (Lansing Grand River)
Canada (Oshawa 1)
17
Spotlight GM - Chevrolet Impala
Impala Production
160,000
140,000
120,000
100,000
80,000
60,000
40,000
20,000
0
• Global Epsilon & Fleet
MS2000
• Fleet Impala at Oshawa 2
ending 2016
• Retail Impala at Oshawa 1
ending in late 2019
• 2015 NAFTA Sales
– Canada – 3,406
– US – 116,825 (140,280)
– Mexico - 0
US (Hamtramck)
Canada (Oshawa 2; Fleet)
Canada (Oshawa 1)
18
Spotlight GM - GMC Terrain
Terrain Production
140,000
120,000
100,000
80,000
60,000
40,000
20,000
• Theta Epsilon  Global
Delta
• 100% Production move to
Mexico by 2018
• 2015 NAFTA Sales
– Canada – 11,524
– US – 112,030 (105,016)
Mexico – 1,867
0
Mexico (San Luis Potosi)
Canada (Ingersoll)
Source: WardsAuto/AutoForecast Solutions – January 2015
19
Spotlight GM - Chevrolet Equinox
Equinox Production
300,000
250,000
200,000
150,000
100,000
50,000
0
Mexico (San Luis Potosi)
US (Spring Hill)
Canada (Ingersoll)
Canada (Oshawa 2)
• Theta Epsilon  Global
Delta
• Recent Ingersoll
investment for next gen.
Equinox
– Could maintain 3 shifts of
production if allotted properly
throughout NAFTA
• 2015 NAFTA Sales
– Canada – 19,559
– US – 277,589 (242,242)
– Mexico - 0
20
Perception vs. Reality
•
What are the true costs of doing business in Canada?
– Current FX rate helps significantly – is it sustainable
•
•
The Double Standard – Canada funding compared to US and
Mexico
Develop a long-term, deep bench strength of resources
– Manufacturing will become increasingly more complex and require a new type of
employee with tech savviness
– Attack at the University level
• Develop educational programs around the “new” automotive space
–
–
–
–
More technology
More value-add
Internship promises sponsored by suppliers and OEMs
Engineering technologists
–
–
–
–
Utility costs
Taxes (personal and corporate)
Materials (aluminum, carbon fiber, etc.)
Make investment in OEM plants to be world-class in productivity, automation,
efficiency, quality, etc.
– Leverage SHAP success – how did they reignite themselves?
21
Education/Training
• Canada value-add focused on highly educated, well trained
staff
– A qualitative value that needs to be quantified
• Short Term – at the plant level
– Determine best practices and educate current managers and staff
– Develop educational programs to stay on cutting edge
• Long term – University level
– Develop specific educational programs geared towards the “new” plant
worker/manager
• Need for understanding new technologies, systems, processes
– “Black Box “Theory – innovation, productivity, and efficiency from raw material to
finished product
– Make the job more appealing to a new generation of workers
– Suppliers and OEM to support through investment and internships
• Promote as an long-term employment strategy – establish a core of new
employees at the university level
22
Canadian Competitive Roadmap
•
•
•
•
•
•
Research a Canada future without GM including impact on economy, supplybase, and labour
Leverage successes learned from SHAP investment; apply to Bramalea and
others
Investigation and education of other Canadian successes
– Toyota and Honda methodologies
– General best practices
More collaboration between OEMs, suppliers, government, and academic
community to strengthen short-term and long-term advantages of Canada
Provincial and Federal investment in OEMs
– Collaborative approach: OEMs receive funding ONLY with matching
commitment through educational programs, local investment, and multi-year
FPPs
Defend core and grow
– Suppliers need to focus on domestic supply but also grow globally
• NAFTA+ and Canada+ concepts
– Investment in global architectures and flexible manufacturing AND/OR unique
platforms for Canada to be sole source (i.e. Minivans)
• Global architectures more attractive due to Canada+ concept
23
Growth - Manufacturing Excellence
Very good is the enemy of excellent
Commitment to Virtual Reality and the new
manufacturing environment
Adaptation of Manufacturing 4.0
Continuous Improvement as a way of life
Awareness of new manufacturing
methodologies
24
Growth – Product Innovation
Innovation in Product and Process
Rethinking every product and process to
establish improvements and enhancements
Looking out side for Innovation
Establishing a change mindset
Partnership in incubators and innovation
sites
Utilizing universities and academia
Partnerships everywhere
25
Canada+ Opportunity by Major Market
CD4/D8
(Ford)
US
1.37 Mil
LX (FCA)
Mexico
0.339 Mil
South America
0.242 Mil
GCP
(Honda)
Western Europe
0.577 Mil
Global Delta (GM)
Eastern Europe
0.276 Mil
China
1.77 Mil
Canada
1.52 Mil
AP less China
1.97 Mil
Source: WardsAuto/AutoForecast Solutions – January 2015
TNGA
(Toyota)
26
The 3 Imperatives for Competitiveness
Supply Chain
Transformation
Supply
Chain
Strengthen both the External
and Internal chains through
transparency/support – an
“Information Supply Chain”
Innovation
Key to revenue growth and
defending the core
Product, process, technology
Innovation
Globalization
Leverage the constantly
expanding competitive
landscape
Leverage
NAFTA+/CANADA+
Globalization
27
Summary
Canada loses NAFTA market share and
production volume as we approach 2020
Net new investments in production facilities
and job creation not keeping pace with our
NAFTA partners
A concerted, consolidated effort to
reestablish our competitiveness is required
We do have areas of strengths
A capable, highly educated work force can
be a differentiating factor
28
Canadian Automotive
Summary & Outlook
Policy and Solutions
Forum
Steve Rodgers, President
GS Global Solutions